Mice born with Combined Lipase Deficiency develop massive chylomicronemia and die within 3 days of allowed to suckle. This condition is caused by a recessive mutation, cld, in the T/t complex of mouse chromosome 17. Hepatocytes of suckled cld/cld mice contained numerous large vacuoles and lysosomes, enclosing small lipoprotein particles, lipid shperes and lamellar structures. These findings suggest that remnants or chylomicrons of VLDL has been taken up, but were not completely degraded. Although lipoprotein lipase activity is very low in extrahepatic tissues, and hepatic lipase activity is low in liver of cld/cld mice, lipoprotein lipase activity is present in liver in these animals at a level 40% of that in unaffected mice. Whether lipoprotein lipase in liver mice could act on chylomicrons in the space of Disse and thereby produce remnants of chylomicrons is not known. The presence of small lipoprotein particles in endoplasmic reticulum, Golgi, vacuoles and lysosomes in hepatocytes of cld/cld mice suggests that lipoproteins were synthesized in these cells, but diverted to lysosomes instead of being secreted. Whether uptake of chylomicrons or intracellular degradation of nascent lipoproteins contributes to lysosomal proliferation in hepatocytes of cld/cld mice requires study. Excess fatty acids produced by lipolysis in adipose tissue were visualized as myelin figures with freeze fracture electron microscopy. Myelin figures were found in adipocytes, extracellular space, endothelial cells and capillary lumen. Fracture faces of myelin figures were continuous with the E fracture face of intracellular and plasma membranes of adipocytes and endothelial cells, demonstrating that leaflets of myelin figures are continuous with external leaflets of these cell membranes. We conclude that fatty acids are present in cell membranes during lipolysis, and partial ionization of fatty acids during tissue processing results in bilayered extensions of membranes in the form of myelin figures.